Co-operative Bank sees mortgage lending fall £500m 

The Co-operative Bank posted gross mortgage lending down 9.4%, or £500m, to £4.8bn from a year ago, due to a “very competitive” home loan market. 

“The mortgage market in 2023 remained very competitive with total average mortgage book margins reducing to 114 basis points from 147bps in 2022,” the lender says in its full-year statement. 

“Average completion margins reduced from 77bps to 61bps compared to 2022.”  

However, it says home loans saw a “strong” start to the year with £1.2bn applications in January. 

The lender is in exclusive talks with Coventry Building Society in December regarding a sale to the Midlands-based mutual, reported to be for £700m.  

Co-operative Bank chief executive Nick Slape says: “These discussions remain ongoing as we continue to evaluate the merits of the combination.” 

Last August, the Co-operative Bank bought Sainsbury’s Bank’s mortgage book, worth around £479m and made up of around 3,500 home loans.  

A month later it rebranded its broker hub Platform to The Co-operative Bank for Intermediaries. 

The lender said the move “allows brokers quick and easy access to our mortgage products and developed additional capabilities paving the way for a more flexible product offering”. 

The bank’s pre-tax profit fell to £71.4m from £132.6m a year ago, largely due to costs related to the potential takeover as well as “exceptional redress on legacy mortgage business.”